Cryptocurrency theft has long been a concern for individuals, businesses, and institutions operating in the digital asset space. While the decentralised and pseudonymous nature of blockchain technology has often been seen as a challenge for recovery, the truth is that crypto recovery is a well-tested and increasingly successful process. In this blog, we’ll break down the numbers, the challenges, and the opportunities for recovering stolen crypto, and how Redefind is making this process more accessible and affordable.

The numbers tell an encouraging story: based on recent Chainalysis data, over 94.95% of stolen crypto can be recovered. This figure represents a significant opportunity for victims of crypto theft to reclaim their assets, especially when considering that Redefind makes the crypto recovery process affordable by insuring the expensive professional costs of recovery.

Bridges and Mixers: Only 5.05%

According to data from the 2024 Chainalysis Crypto Crime Report, an average of 3.57% of laundered crypto flows through mixers and 1.49% through bridges, totaling 5.05% (with a high of 7.43% in 2020 and a low of 2.33% in 2019). Bridges and mixers are common methods used to launder crypto crime proceeds (Chainalysis report, page 7). These methods are designed to obscure the origin of funds, but they are not foolproof. This means that the 5.05% of funds sent through bridges or mixers are not completely unrecoverable. So, by saying 94.95% of stolen crypto can be recovered, this could be considered conservative.

Year	Total Crypto Laundered (bn, $)	Mixer (bn, $)	Mixer %	Bridges (bn, $)	Bridge %	Mixer & Bridges (bn, $)	Mixer & Bridges %	% of Obfuscated via Mixers
2023	$22.20	$0.504	2.27%	$0.7430	3.35%	$1.25	5.62%	40.42%
2022	$31.50	$1.010	3.21%	$0.3120	0.99%	$1.32	4.20%	76.40%
2021	$18.30	$0.663	3.62%	$0.3800	2.08%	$1.04	5.70%	63.56%
2020	$9.90	$0.639	6.46%	$0.0963	0.97%	$0.74	7.43%	86.91%
2019	$11.10	$0.252	2.27%	$0.0061	0.05%	$0.26	2.33%	97.64%
Average			3.57%	1.49%		5.05%

Source: Chainalysis

Crypto Recovery: A Proven Process

How Crypto Recovery Works:

• Blockchain Transparency: Contrary to popular belief, blockchain technology is not anonymous—it’s pseudonymous. Every transaction is recorded on a public ledger, making it possible to trace the flow of funds with the right tools and expertise.
• Legal Expertise: Legal professionals play a critical role by leveraging their expertise to initiate recovery efforts. Through a combination of advanced blockchain tracing tools, evolving legal frameworks, and specialised knowledge in crypto asset recovery, lawyers can implement effective strategies to secure the return of stolen assets. These advancements have significantly improved the success rate of crypto recovery cases.
• Law Enforcement: Their involvement not only strengthens the recovery efforts but also adds authority and credibility to the above stages.

Crypto Recovery Case Studies

Crypto recovery is not only possible but has been successfully executed in numerous cases. At Redefind, we’ve handled several recovery cases, including two that will be detailed in upcoming blog posts. These cases demonstrate the power of combining legal expertise and advanced technical methods to trace and reclaim stolen cryptoassets. Beyond our work, other notable public crypto recovery cases include the following:

1. Recovery of Life Savings (£300,000)

An elderly man, Mr. X, lost £300,000 in a crypto scam involving fake investment platforms. The funds were traced to a Binance wallet.

Strategies Employed:

• Police used Chainalysis to trace 5.8 BTC to a Binance account.
• The Police contacted the account owner, to request the return of the funds. There was no cooperation from the individual, and although recovery attempts were made pursuant to Part 5 of the Proceeds of Crime Act 2002 (POCA), they were unable to seize the assets using police powers.
• Given the difficulties in recovery, and the historic record of success in collaboration between public and private sector, Mr X was therefore passed to Edmonds Marshall McMahon (EMM) to pursue recovery of his assets.
• The hacker’s account was frozen, and legal action was taken to recover the funds.

Outcome:

To achieve the recovery of the assets, EMM worked with Binance to obtain the necessary release documentation. EMM recovered the cryptocurrency, converted, and returned it to Mr X.

Source: Edmonds Marshall McMahon

2. Recovery of £80,000 Stolen in a Crypto Scam

Ms. Sutton, an elderly woman, was scammed out of £80,000 by a fraudster posing as a cryptocurrency investment advisor. The funds were traced to a Binance account. Realising she had been defrauded, Ms. Sutton reported the scam to the police in early 2023.

Strategies Employed:

• The Police traced the stolen funds to Binance, which swiftly applied a voluntary freeze on the associated account.
• The owner of the Binance account and suspected fraudster, a Nigerian national, refused to engage with the police or Binance, which complicated any further action by the Police due to his location in Nigeria outside the jurisdiction.
• Proceedings were issued in the High Court against Persons Unknown in mid-April 2024, pleading typical causes of action in deceit and fraudulent misrepresentation, along with a suite of remedies and the usual orders for service by alternative means.
• In June 2024, the High Court granted the default judgment and order for delivery up, which was served on the fraudster but also on Binance. Binance then complied with the order, returning Ms Sutton’s stolen life savings.

Outcome:

Binance complied with the court order, and Ms. Sutton recovered her stolen funds. This case highlighted the effectiveness of combining legal action with exchange cooperation.

Edmonds Marshall McMahon comments:

Recovering funds in low-value crypto fraud cases remains challenging, due to the pointlessness of Action Fraud, the reluctance of the authorities to intervene and the prohibitively high costs of civil proceedings. With the precipitous increase in crypto frauds, this case underscores the necessity for innovative and cost-effective solutions. Solutions are required if we are to properly tackle this type of fraud for the ordinary victims of crypto frauds, who don’t lose millions, but tens or hundreds of thousands of pounds of life savings. Despite the typical risks and expenses, the approach taken in Sutton’s case may provide a blueprint for similar future actions, offering hope to other victims of crypto fraud.

Source: Edmonds Marshall McMahon

3. Massachusetts Individual Case (2023)

A victim lost $975,900 in a fraudulent investment scheme. U.S. authorities traced and seized 87,637 Tether (USDT) from a Binance account.

Source: U.S. Secret Service

Considerations: The Challenges of Crypto Recovery

a) Privacy Concerns

There have been dozens of successful crypto recovery stories, but many remain private due to several key factors:

• Stigma: A significant 84.4% of crypto thefts in 2024 were the result of social engineering attacks. Victims often feel embarrassed or fear reputational damage, leading them to keep their cases anonymous.
• Taboo: The societal stigma around falling victim to theft creates a reluctance to report incidents, which limits the number of cases pursued.
• Privacy Concerns: Court cases are often public record, and not all qualify for anonymity or injunctions to protect the victim’s identity, discouraging some from pursuing legal action.
• Ownership Privacy: For many victims, the theft may be the first visible indication of their crypto ownership. To avoid exposing their holdings, they may choose to remain silent.
• Fear of Retaliation: Crypto theft often involves dangerous individuals or groups. Victims may fear targeted follow-ups or revenge attacks, incentivising them to maintain a low profile.

b) Anomalies and Edge Cases

While rare, there are anomalies that can make recovery impossible. For example, if a hacker loses the seed phrase to a wallet or passes away, the funds may be permanently inaccessible. However, these cases are extremely rare, as most thefts are carried out by organized groups where multiple individuals have access to the stolen assets or seed phrase. We are not aware of any confirmed cases of this happening—except perhaps in the case of Satoshi Nakamoto, who obviously did not steal his coins (although some diligent readers may argue that pre-mining is a light form of theft!).

c) Sanctioned Entities and Insurance Law

Funds sent to sanctioned entities or jurisdictions are technically recoverable, but UK insurance law prevents policies from activating in these cases. The Lloyd’s sanctions exclusion clause explicitly excludes coverage for losses tied to sanctioned entities, meaning that while recovery is possible, it falls outside the scope of any insurance protection (including Redefind’s crypto theft policy).

d) Cost of Recovery

The costs associated with crypto recovery can be high, leading some victims to avoid pursuing recovery altogether. Many fear throwing "good money after bad." However, as discussed above, 94.95% of stolen crypto can be recovered, and even within the remaining 5.05%, recovery may be possible.

The downside of the well-established crypto recovery process is its cost. Crypto recovery can cost well over £100,000 due to the niche professional expertise required. This is where insurance comes in. Redefind's Cryptoasset Theft Insurance policy, launched on 1st July 2025, insures these crypto recovery investigation and legal services, making recovery possible for a much larger demographic of crypto owners.

In some situations, people’s crypto wealth is the only wealth they have and despite seeking remedy and justice they simply do not have the means to attempt to recover their assets using their own money. Litigation funding would be an obvious solution but participants are rare and their financial expectations are unrealistic.

Conclusion

Crypto recovery is not just possible—it’s proven. The Redefind team are proud to be at the forefront of this innovation, making recovery affordable and accessible for everyone by insuring these costs. You can sign up for a crypto theft insurance policy here.